Over the last year or so, a lot of effort went into covering the issues that traditional media is facing. Whether this is movie or television studios, the impact is the same.

Disruption is a force that cannot be stopped. History shows that most of this happens from outside an industry. Why is that? Are the executives at the incumbent companies lazy, stupid, or unwilling to change? Do they not see what is happening?

While it is easy to come to this conclusion, it is rarely reality. Most executives are not walking around with their head up the proverbial hind end. They are aware of what is taking place.

If this is true, why do they not prevent it?

Here is where the nature of disruption explains it.

Incumbent entities are disrupted simply because the interest of the different stakeholders no longer align. This means there is infighting, with status quo always being the winner. Remember, for a corporate entity to change, the table of "yeses" has to be run. A single no is the defacto for the status quo.

How often do we see this happen?

It is why stories like Netflix occur. Somewhere along the line, the idea of setting up a streaming service was denied. Hence, while everyone was looking at the red envelops mailed out, the true distribution change was to streaming.

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Media Companies Facing A Rapid Demise And Web 3.0Could Capture This

This is not a story about Web 3.0 , at least not yet. It is occurring regardless of what the Web 3.0 world does.

Media companies are the prey. There are two waves that assure this outcome.

As we covered in the past, the first was the breaking up of the monopoly on distribution. Studios once has this exclusive. That is no longer the case as evidence by the success of YouTube.

While video took a while, this was due to the fact other advancements were required. In 2005, there simply was not the bandwidth to have so much video. We also were dealing with lesser technology on our computers, everything from less memory to lame webcams.

The last decade and a half saw a massive change. We now have advanced telecommunication systems which allow for the streaming of video fairly easily. Videos filmed on phones are sufficient for TikTok or YouTube. While not Hollywood quality, they are worth 5-10 minutes.

Hollywood is facing the next wave and it will be much quicker than the last.

This is due to AI.

We see what OpenAI, Google, and some other companies are already offering. These are the early stages of AI video generation but it is only a matter of time before things get better.

Here is the scaling laws for neural networks. This is why advancement is exponential, at least for the near future. All of these are increasing massively.

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Unlike the last disruption, the advancement of AI for content creation is going to put the media companies in a position that resembles the newspapers.

When the Internet came about, text was easier to deal with. Newspapers all over the world closed (or consolidated) as readers turned elsewhere for information. Suddenly, everyone with a Wordpress page was a "journalist".

The first image tells the entire story.

We are looking at a massive amount of volume of video. The first box shows how just .01% of the video uploaded to YouTube could double the yearly output of Hollywood. That is a stunning figure.

It is also one that is likely to increase as we consider other video platforms.

Ultimately, this all revolves around where the eyeballs are going.

Will Web 3.0 Capture This?

Since the question of the contraction of Hollywood is no longer an issue, what happens? In other words, where does the attention go?

Will YouTube continue to eat up market share? This is something that is easy to believe.

While I think Google will be okay on this end, it will face Web 2.0 competition. Other platforms are adding video. There is Rumble and its reported 50 million users. Then we have fact that other social media platforms are breaking into this. Facebook and X will likely offer this just like YouTube. With costs associated with video declining, it only makes sense.

The success of TikTok shows how even 60 second videos can add up to a lot of hours. We know videos of this nature are only growing with each passing year.

Video is the new photos. What happened when cameras went digital?

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It is safe to say that TikTok, at a minimum, set video off on a path similar to this.

Hence, we have the question of whether Web 3.0 will capture this? Is the transition going to include this or will it miss the boat?

That is something that everyone within the industry needs to take a look at. Once again, we are back to the unmistakable fact that 95% (if not more) of those involved are focused solely on price go up. Nothing else matters.

The lack of business minds is stunning when it comes to this industry. Where it does exist, we see the venture capitalists getting involved. This puts us in a position of creating a similar situation where a few platforms end up dominating.

If that happens, people have nobody to blame but themselves. Even the most basic of tools means that we can start the transition.

Will it happen? That remains to be seen.

Web 3.0 is a tremendous opportunity. Of course, like most, they have to be taken advantage of.

There are hundreds of billions of dollars up for grabs in the market capitalization of traditional media companies. Where will that get distributed to?

The industry can decide. A shift is happening, it just depends upon what will be done about it.

Right now, Web 2.0 is well positioned for it.

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